Aim to help economicsized units

Press, Volume CXII, Issue 32879, 30 March 1972, Page 8

Aim to help economicsized units

As was to be expected, the seminar on the sheep retention incentive scheme at Lincoln College last week-end had not gone very far when someone was wanting to know why farmers with fewer than 251 sheep were excluded from the scheme and payments on any flock were subject to the first 250 not qualifying for a grant.

Mr F. L. Ward, director of the Economic Service of the Meat and Wool Boards, who was one of those intimately associated with the formulation of the scheme, said he would decline to answer that question. The official reason was that anyone with a flock below that level was not dependent on sheep farming for a living, but other factors had to be considered too. The answer was that the scheme was broadly based to help the sheep farming industry and no-one with only 200 or even 500 sheep could really be considered a viable sheep farmer today, said Mr C. H. Terry, director of the external economic policy and land use division of Treasury, who also spoke as "one who was intimately associated with the conception and gestation of the proposal.” It was not envisaged as a social security scheme, but as a means of keeping economic-sized units in business. There were other ways of helping the uneconomic farm, but normally such assistance should be given on a conditional basis involving some supervision of how the money was spent In many cases the best assistance which could be given was to help the farmer off the property and amalgamate it with another unit. The objective of the stock retention scheme was different. It was aimed at helping the farmer with a good economic-sized unit, running 2000 sheep or more, to keep his farm going as a viable proposition. Any Government, when spending the taxpayers’ money, had to be careful to ensure that equity and justice was done to all sections.

“In the case of assistance to fanners, for instance, social security beneficiaries and lower paid wage earners are inclined to ask what business Government has in helping people who are substantially better off in terms of income and assets than a large proportion of the community. They may further ask why people should be supported in any particular business or occupation because that business has fallen on hard times. Should, for instance, the Government help to support the comer grocer, who is being squeezed by the supermarket down the road, or the barber, who is suffering because males no longer want short back and sides, any more than farmers who, if they do not like the business, can get out. “These are hard questions, but ones which Treasury as the guardian of the taxpayers’ money has a responsibility to ask. We asked ourselves these questions and concluded that the importance of the industry to the economy and the damage which could be caused to the country as a whole if it became run down was such that emergency action was justified.” Why did the scheme provide for a graduated scale of payments? he asked. There were good political and economic reasons for doing this. Most taxpayers would find it pretty difficult to believe that a man with, say, 10,000 to 20,000 sheep and an income far in excess of the national average, either needed any money or if he got it whether he would be likely to spend it on maintaining or improving the farm, rather than indulging in additional consumption or investments outside the farm. There

were good economic reasons for subscribing to this view, in part at least. The graduated system was devised to give greatest relative assistance to the man in the middle—the typical sheep farmer with 2000 to 2500 sheep. “I might say that because the Meat Board was able to contribute slsm to the cost of the scheme, it was possible to make it more generous and less steeply graduated than would have been the case if only the taxpayers’ money was involved. In effect, the Meat Board was able to top it off by putting the icing on the cake,” said Mr Terry.